Retained Earnings Are a Component Of

question 25

Multiple Choice

Retained earnings are a component of:

• A) reserves.
• B) contributed equity.
• C) other equity.
• D) comprehensive income.

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Definitions:

Adjusted Basis

The adjusted basis is the original cost of an asset, altered for improvements, depreciation, and other adjustments.

Travel Expense Deduction

A tax deduction for expenses related to travel for business purposes, including transportation, lodging, and meals.

Self-Employment Tax

A tax consisting of Social Security and Medicare taxes primarily for individuals who work for themselves, calculated on net earnings from self-employment.

Net Earnings

The amount of money left after all deductions, including taxes and operating expenses, have been subtracted from total income.